Online lottery ticket company Jackpot gets funding from top sports executives

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  • Jackpot wants to grow the American lottery business by putting it online.
  • The company has raised money from top sports executives, and NBA superstars James Hardin and Joel Embiid and NHL great Martin Brodeur have ousted some big-name investors.
  • The platform hopes to attract a new, younger demographic.

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online lottery ticket company jackpot announced Wednesday that it closed on $35 million in Series A funding, led by some of the biggest names in sports, who see promising growth potential in digital lottery sales.

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The cash investment could enable Jackpot to launch its website and app later this year in select locations where online lottery ticket sales are allowed. For example, the company said it can operate in states including New York, New Jersey, Texas, Ohio and Oregon.

funding was headed for the round associate enterprisea venture capital firm co-founded by DraftKings board member Ryan Moore and Courtside Ventures, and Early stage investors in the sports, digital media, fitness and gaming businesses. Further investors include: The Kraft Group, which owns the New England Patriots; Haslam Sports Group, which owns the Cleveland Browns; Radicals CEO Michael Rubin; Jason Robbins, CEO of DraftKings; and Boston Red Sox president Sam Kennedy. NBA superstars James Hardin and Joel Embiid and NHL great Martin Brodeur ousted some big-name investors.

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“What we’re doing is allowing you to buy lottery tickets without really leaving the couch,” Akshaye Khanna, co-founder and CEO of Jackpot of North America, told CNBC in an interview.

The $100 billion a year lottery business is still mostly cash-based, with buyers getting tickets at bodegas, convenience stores, gas stations and other places.

Jackpot, which says it wants to change business more in line with the online shopping habits of today’s consumers, will make its money by charging a convenience fee on purchases. The company said it is currently working with local regulators in select states for approvals to roll out the service.

“More than a dozen states have been incredibly receptive to this because they’ve realized it’s really a fundamentally different channel for the same product,” Khanna said.

In 2021, Jackpot said its research shows that 53% of Americans bought lottery tickets, but only 5% of them were bought online. Khanna said making lottery tickets online more widely accessible would help in increasing the sales revenue for the states.

“We certainly think it will potentially appeal to a younger and more diverse demographic,” Khanna said. “This is one of the reasons states support this model, because one of the goals here is to expand this product to people who are not traditionally lottery ticket buyers.”

But some critics, like National Council on Problem GamblingBe warned that easing access to buying lottery tickets can be a slippery slope for at-risk individuals.

“Any form of online gambling inherently gives the user a sense of anonymity and is much easier to hide than other forms of gambling,” Jaime Costello, the group’s director of programs, said in an email. “These features, paired with quick access to purchases, results, etc., increase the risk of problems for individuals buying lottery tickets online.”

Khanna said the jackpot will have age verification controls and the company is making investments to comply with state regulations.

Credit: www.cnbc.com /

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